Cells capable of adoptive transfer of experimental allergic encephalomyelitis (EAE) are manipulated in vitro in order to examine the mechanisms responsible for this autoimmune disease. Cellular immunity to myelin basic protein (BP) is required for induction of EAE. Cellular proliferation, IL-2 production and IL-2 utilization, are necessary but not sufficient for disease transfer. Other proinflammatory pathways must be induced if acute clinical EAE is to develop. Lipopolysaccharide (LPS) or LPS-activated cells apparently provide the necessary proinflammatory component and, in collaboration with BP-specific cells exposed to IL-2, transfer severe EAE. In addition to the cellular immunity and inflammation in acute EAE, chronic EAE has the added component of demyelination. Demyelination can now be induced in animals injected in separate sites with encephalitogen (i.e. BP) and an encephalitogen-free source of central nervous system antigens (i.e. chicken brain). The antigen responsible for demyelination is found in the myelin fraction of chicken brain.